The same week Sen. Shelley Moore Capito (R-W. Va.) introduced a new bill pushing back on implementation of the U.S. Environmental Protection Agency’s (EPA) proposed Clean Power Plan, organizations released tools to help states and regulators navigate compliance with the resulting rule, set to be finalized this summer.

The rule uses an infrequently exercised provision of the Clean Air Act to set state-specific reduction targets for carbon dioxide and to allow states to devise individual or joint plans to meet those targets. One tool—the Multistate Coordination Resources for Clean Power Plan Compliance—developed by the National Association of Regulatory Utility Commissioners and the Eastern Interconnection States Planning Council looks to build on the flexibility the proposed rule gives states to meet their interim and final emissions reduction goals. The document is aimed at helping states overcome institutional barriers to coordination of rule compliance efforts(subscription). The guide includes a multistate planning checklist, a legislative language examples checklist and a sample memorandum of understanding for multistate coordination.

“A range of interactions is possible, from simple awareness of each others’ plans to the transfer of emissions reductions between states that have individual-state plans and targets (not a multi-state plan to meet a joint target) when states have ‘common elements’ in their compliance plan,”the guide notes.

The common elements concept was developed at Duke University’s Nicholas Institute for Environmental Policy Solutions and is an idea I spoke about last month at the Navigating American Carbon World conference in California. In a nutshell, power plant owners can transfer low-cost emissions reductions between states whose compliance plans share common elements—credits defined in the same way and mechanisms to protect against double counting. This approach builds on existing state and federal trading programs while maintaining the traditional roles of state energy and environmental regulators.

Still another tool—a calculator—arms state air quality agencies with the data to estimate carbon emissions savings from state adoption and enforcement of stringent building energy codes in state compliance plans under the proposed EPA rule.

“Because energy savings from stronger building energy codes put thousands in the wallets of home and commercial building owners, and improve building quality, comfort, and resale value, state officials should be adopting them simply to benefit their residents,” said William Fay, executive director of the Energy Efficient Codes Coalition. “But because buildings use 71 percent of America’s electricity, 54 percent of our natural gas, and 42 percent of all energy, improving their efficiency has profound potential benefits to national energy policy as well.”

Seasonal conditions in the Arctic mean that drilling can typically occur only over a four-month period, but a reduction of the ice due to climate change could ignite Arctic drilling aspirations. For many in industry, the news was welcome.

“The Chukchi Sea is widely seen as one of the last great unexplored conventional oil basins,” said Alison Wolters, an analyst with Wood MacKenzie’s Alaska and Gulf of Mexico programs. “A positive discovery this season would encourage the other operators to reconsider the region.”

On the heels of the BOEM’s greenlighting of renewed oil drilling in the Arctic, Christiana Figueres, who leads the U.N. Framework Convention on Climate Change, noted that achieving net-zero emissions by 2100 means that many oil and gas reserves must remain untapped (subscription).

“We have absolutely no opinion about what governments do with companies that operate within their geographic boundaries,” she said. “But there is an increasing amount of analysis that points to the fact that we will have to keep the great majority of fossil fuels underground.”

Report: Oil Price Drop Could Hurt Global Economy

A new report from the Global Commission on the Economy and Climate finds that the recent drop in oil and natural gas prices—although providing temporary relief for consumers—may compel governments to authorize projects that use expensive carbon-intensive fuels. In fact, the Oil Prices and the New Climate Economy report suggests that governments shouldtake advantage of low prices to reduce dependency and reform fossil fuel subsidies (subscription).

“For years, we’ve had a market failure by not taxing carbon and air pollution nearly enough,” said Lord Stern, co-author and a prominent climate economist. “That is subsidizing hydrocarbons in my book. When oil prices fall, it is a wise time to change it and that will also help protect us against energy price volatility in the future.”

The report notes that renewable energy sources—including solar and wind—have little to no operating cost after installation and suggests their use can lock in the cost of energy for two or more decades.

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